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The zloty will remain stable despite tensions in the Middle East, and the euro rate may fall to 4.2 zł
The zloty is expected to remain stable, but much depends on the Middle East
Over the next few months the zloty should remain fairly stable, according to PKO BP strategist Mirosław Budzicki. In his view, EUR/PLN will mainly depend on events in the Middle East, above all on relations between the US and Iran.
If a lasting agreement is reached, the euro rate could move closer to 4,2 zł, and even fall below 4,22 zł. In practice, that means that for people exchanging currency in Poland, even a small shift in global sentiment can affect the cost of holidays, transfers or euro-denominated settlements.
The economist also points to oil prices. If an agreement is reached, they could fall to around 80 dollars per barrel. That matters because lower oil prices usually ease pressure on commodity prices and improve market sentiment, which can be supportive for the zloty.
Another positive factor for the Polish currency is the inflow of foreign capital into the government bond market. Budzicki notes that demand for Polish securities remains strong, while investors are also being drawn by global interest in risk assets, especially technology and AI.
In his view, over the next few months EUR/PLN could trade in a range of 4,22-4,26 zł, and more broadly between 4,2-4,3 zł. He also notes that the average zloty-to-euro exchange rate since the start of 2025 has been 4,24 zł.
There are, however, also factors that could weigh on the currency. One is a possible rate hike in the euro area. The market expects one next week, but according to the ECB strategist, the move is already largely priced in. It would be different if a full tightening cycle were to begin.
The comments of NBP governor Adam Glapiński may also matter. Budzicki recalls that his communication was meant to cool expectations for rate hikes in Poland. At the start of the month, the market was pricing in two hikes totaling 50 basis points, but the RPP does not currently look ready for such decisions.
Another risk is the current account deficit. Even so, the PKO BP strategist believes the current negative factors are not strong enough to trigger a clear weakening of the zloty.
Over the longer term, there are also arguments in Poland’s favor. Budzicki points to consultations by S&P DJI on reclassifying Poland as a developed market. Such a move would mean an upgrade from emerging-market indexes to the developed-market group and would be a positive signal for foreign investors.
The economist also highlights a comment from rating agency S&P, which suggested that Poland’s rating could be raised if certain conditions are met. In his view, reports about the possible stationing of nuclear weapons in Poland by the US have similar significance, as they strengthen the country’s standing in an uncertain geopolitical environment.
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